Graham (NYSE:GHC) Shares Gap Down Following Weak Earnings

Key Points

• Shares gapped down after Graham reported a quarterly EPS of $6.62, missing the $14.64 consensus by $8.02, and posted revenue of $1.24B versus the $1.27B estimate.
• The company declared a quarterly dividend of $1.88 ($7.52 annualized) with an ex-dividend date of April 16, implying a yield of about 0.7% and a payout ratio of 11.33%.
• Wall Street Zen downgraded Graham from "buy" to "hold" even as MarketBeat shows a consensus "Buy," and institutional ownership remains high at 93.16% with several funds modestly increasing stakes.

Shares of Graham Holdings Company (NYSE:GHC - Get Free Report) gapped down before the market opened on Thursday following a weaker than expected earnings announcement. The stock had previously closed at $1,150.00, but opened at $1,069.09. Graham shares last traded at $1,101.1790, with a volume of 1,667 shares.

The company reported $6.62 EPS for the quarter, missing analysts' consensus estimates of $14.64 by ($8.02). The firm had revenue of $1.24 billion during the quarter, compared to analysts' expectations of $1.27 billion. Graham had a return on equity of 5.03% and a net margin of 5.95%.

Graham Dividend Announcement

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, May 7th. Shareholders of record on Thursday, April 16th will be paid a dividend of $1.88 per share. This represents a $7.52 annualized dividend and a yield of 0.7%. The ex-dividend date of this dividend is Thursday, April 16th. Graham's payout ratio is presently 11.33%.

Wall Street Analyst Weigh In

Separately, Wall Street Zen cut Graham from a "buy" rating to a "hold" rating in a research note on Friday, January 23rd. One investment analyst has rated the stock with a Buy rating, According to data from MarketBeat, the company presently has a consensus rating of "Buy".

Institutional Inflows and Outflows

A number of hedge funds have recently modified their holdings of GHC. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. grew its stake in shares of Graham by 3.1% during the first quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 2,307 shares of the company's stock valued at $2,217,000 after buying an additional 69 shares during the last quarter. Goldman Sachs Group Inc. grew its stake in Graham by 5.6% in the first quarter. Goldman Sachs Group Inc. now owns 27,167 shares of the company's stock worth $26,104,000 after purchasing an additional 1,448 shares in the last quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC grew its stake in Graham by 3.3% in the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 6,765 shares of the company's stock worth $6,500,000 after purchasing an additional 214 shares in the last quarter. Jane Street Group LLC grew its stake in Graham by 39.8% in the first quarter. Jane Street Group LLC now owns 8,250 shares of the company's stock worth $7,927,000 after purchasing an additional 2,350 shares in the last quarter. Finally, Invesco Ltd. grew its stake in Graham by 35.2% in the second quarter. Invesco Ltd. now owns 29,305 shares of the company's stock worth $27,728,000 after purchasing an additional 7,628 shares in the last quarter. Institutional investors own 93.16% of the company's stock.

Graham Stock Performance

The company has a market cap of $4.84 billion, a P/E ratio of 16.69 and a beta of 0.79. The firm has a 50 day moving average of $1,084.75 and a 200-day moving average of $1,089.39. The company has a quick ratio of 1.53, a current ratio of 1.75 and a debt-to-equity ratio of 0.15.

Graham Company Profile

Graham Corporation is a U.S.-based industrial equipment manufacturer specializing in the design and production of vacuum and heat transfer systems. The company's core offerings include vacuum pumps, exhausters, and energy recovery turbines, as well as steam surface condensers and specialized heat exchangers. These products are engineered to support critical processes in industries that require controlled environments and efficient thermal management.

In addition to its standard product lines, Graham Corporation provides aftermarket services such as equipment installation, field maintenance, performance testing, and spare parts supply.

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